Syrian President Bashar Al Assad received Iran's Minister of Defence Brigadier General Azizi Nasirzadeh in Damascus on Sunday. AFP
Syrian President Bashar Al Assad received Iran's Minister of Defence Brigadier General Azizi Nasirzadeh in Damascus on Sunday. AFP

Iranian Defence Minister meets Assad amid mounting Israeli attacks on Tehran's allies in Syria



Iranian Defence Minister Azizi Nasirzadeh on Sunday held security discussions with Syria's President Bashar Al Assad in Damascus, state media reported, amid mounting Israeli attacks on Syrian security forces and Tehran-allied militias in the country.

He is the second senior Iranian official to visit Syria in as many weeks. On Thursday, the same day Israel bombed what it described as Palestinian Islamic Jihad compounds in Damascus, Ali Larijani, senior adviser Iran's supreme leader Ayatollah Ali Khamenei, met Mr Al Assad. No details were disclosed about the meeting.

The PIJ is among the militant groups closest to Iran in the Middle East and the attack killed 15 people, Syrian state media reported.

Mr Al Assad and Mr Nasirzadeh spoke about “issues related to defence and security in the region, and bolstering co-operation between the two countries,” the official Syrian news agency Sana said.

Iranian state media reported shortly before his arrival on Saturday that Mr Nasirzadeh, accompanied by high-level officials, would “explore ways to enhance defence and security co-operation” during the visit.

It quoted Mr Nasirzadeh as saying that Syria plays “a strategic role in Iran’s foreign policy”, and that the two countries support each other in “critical” times.

The alliance is critical to the strategic position of Hezbollah, Iran's most powerful regional ally, in the continuing war with Israel. Since the outbreak of the 2011 revolt against the Assad government, Iran has poured militia proxies into Syria and built corridors of control across the country. These areas have acted as supply lines for Hezbollah, which attacked northern Israel a day after the Gaza war started on October 7, last year.

In the wake of the success of an Israeli campaign to weaken the militant group in the second half of this year, Israeli planes struck in September a compound near Damascus linked to Mr Al Assad’s brother, Brig Gen Maher Al Assad, indicating Israel could be willing to attack senior Syrian military officials. Brig Gen Maher heads the Fourth Mechanised Division, the best-trained and equipped part of the army, which is also seen as the closest unit to Iran.

Elite Syrian army and intelligence units, which underpin the ruling system, have also come under attack by Israel in the past several months. This has put pressure on the alliance between Damascus and Tehran, although the Syrian government has tried to distance itself from attacks emanating from Syria by Iran's militia allies on Israeli targets.

In recent weeks, the capital Damascus has been struck by Israel as it escalated its campaign against Hezbollah. A series of operations killed many of the Lebanese group's leadership, including former leader Hassan Nasrallah, as well as operational commanders on the ground, forcing the group to rely more on Syria to maintain its command structure, security experts say.

A member of the Syrian opposition, who is based in Jordan and tracks Iranian activities in Syria, said that since the start of the Gaza war, areas in the Iranian zone of control in Syria have been increasingly serving as “a kitchen for Iran: a weapons laboratory and development centre”, as well as the main routes for supplying weapons to Hezbollah.

Allied Iran-backed militias in Iraq, who are crucial to maintaining its weapons supply from the east, have also come under increased military pressure, after the recent US air raids on areas near the border with Iraq in eastern Syria.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: November 18, 2024, 7:32 AM